Clean Revolution leader: IKEA

Date

13 October 2011

This summarized case study is one of an initial set of eight success stories which illustrate the emerging global leadership of the Clean Revolution. The full-length case study - plus the other seven case studies and more information on The Clean Revolution - can all be found at TheCleanRevolution.org.

IKEA: The world's largest furniture retailer

Boasting a pioneering 100% renewable energy target, 40 solar PV systems installed across its European and North American stores, as well as a promise to sell only energy-efficient lighting, IKEA proves sustainability is core to its business strategy.

By ensuring that all consumer goods are in-line with the Clean Revolution, IKEA is showing transformative leadership which will inspire others.

“What is good for our customers is also good for us in the long run. We are not on the stock exchange, so we can act long term.”– Mikael Ohlsson, CEO, IKEA Group

IKEA's leading sustainability actions - such as its bold 100% renewables target - are in part due to IKEA's long-term view on its costs, investments and products.

And how has the long-term approach affected profits? FY2010 profits for IKEA Group have increased 6.1% to $3 billion.

Now, with a plan to install even more solar PV systems, introduce wind turbines and make all products renewable, recycled or recyclable by 2015, IKEA Group’s profits will surely continue to soar.

Financial benefit

IKEA is known for its flat packaging. From an environmental standpoint, flat packages are great because they allow more items to be shipped in a single trip, reducing transport emissions. But the main reason for the flat package is cost savings. For example, designing the EKTORP sofa to pack flat for transport saves IKEA $11.6 million a year in transport costs and reduces the associated carbon emissions by 75%.

Competitive advantage

IKEA wants to get innovative products to their customers before their competitors. One way they achieve this is by ‘price investing’ in next-generation, energy-efficient technologies likeLED light bulbs and induction cookers – charging a lower price in order to drive volumes and create a market. With induction-cooker hobs, they brought the price down by a third over 12 months and experienced a four-fold increase in sales as a result.

IKEA's leading work is just part of The Clean Revolution. Your leadership will drive The Clean Revolution - and your leadership is needed now. We’re looking for business and government leaders who can either help support the campaign or provide us with compelling case studies. Join now, to help us deliver a better, smarter, more prosperous future for all.